‘Troubled times’ for shops as customers fall

THE number of customers in Scottish stores plummeted compared to the rest of the UK, where shops enjoyed an unexpected rise, according to a new report that warns of “troubled times” ahead for Scotland.

The Scottish Retail Consortium (SRC) has reported an 8.5 per cent drop in footfall in the three months to January 2012, which included the peak Christmas period, compared with the same three months to January 2011.

Ministers have also been warned that new business taxes announced in the budget will have a further “damaging” impact. Scotland was the hardest-hit part of Britain, with footfall “considerably worse” than the 1.8 per cent rise across the rest of the UK.

However, according to the SRC there was an “encouraging” decrease in empty stores in Scotland, with January vacancies falling 0.5 per cent from October to 9.1 per cent. The figures come five days after the SRC’s “worrying” retail sales monitor recorded the biggest fall in sales in Scottish stores in more than a decade.

SRC director Ian Shearer said: “These results are further evidence of the troubled times for Scottish retail. Even Christmas failed to bring shoppers out in Scotland.”

He said the drop in footfall “sadly mirrors the worrying monthly sales figures” in the retail sales monitor.

He added: “Consumer confidence is unfortunately weaker in Scotland than UK-wide and that’s hit consumer spending. Concerns about personal finances and job security are biting, putting people off shopping with no sign yet that a turnaround is coming.

“With the Scottish Government reviewing town centres this year, the factors affecting the retail sector and its massive contribution to regeneration and employment need to be clearly understood.

“April’s above-inflation rises in business rates (up 5.6 per cent) will have a further damaging impact and exemplify the wrong approach.”

Diane Wehrle, research director at customer counting service Springboard, said the UK picture was “positive news considering some key players have recently gone into administration and there’s been a wave of profit loss announcements”.

She said: “For the first time in five years, December saw footfall up on the previous year as savvy shoppers took advantage of heavy retailer discounting.”

A Scottish Government spokeswoman said the more “robust” Retail Sales Index shows “the volume and value of retail sales increased in the fourth quarter of 2011”, with Scottish volume increasing by 0.7 per cent over 2011 against 0.3 per cent growth in Britain.

She said that businesses can spread payment of next year’s higher rates bill over three years through a rates deferral scheme.

She added: “We are taking every possible step to enhance economic and consumer confidence, as well as support business through difficult trading conditions.”